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Q about assessable trading income

Forums › ACCA Forums › ACCA TX Taxation Forums › Q about assessable trading income

  • This topic has 0 replies, 1 voice, and was last updated 9 years ago by dadabobo.
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  • July 19, 2015 at 6:05 am #261086
    dadabobo
    Member
    • Topics: 10
    • Replies: 6
    • ☆

    Dear all,

    My question concerns assessable trading income with accounting date in second year.

    I am going to take the example 2.7 of BPP 2015-2016 study text Ch. 10, P.141.

    Wilma starts to trade on 1 October 2014. She made taxable profits of £9’000 for the first nine months to 30 June 2015 and £30’000 for the year to 30 June 2016.

    The taxable profits for the first three tax years are as follows:

    Year Basis period Working Taxable profits
    2014/15 1.10.14 – 5.4.15 £9’000×6/9 £6’000
    2015/16 1.10.14 – 30.9.15 £9’000+£30000×3/12 £16’500
    2016/17 1.7.15 – 30.6.16 £30’000

    Is she getting taxed on the same amount twice in this case (the £6’000 pro-rated amount earned between 1.10.14 and 5.4.15)? Or did I miss something?

    Thank you in advance for your help.

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